The paper empirically analyzes the incentive effects of equalizing transfers on business tax policy by exploiting a natural experiment in the state of Lower Saxony which changed its equalization formula as of 1999. We resort to within-state and across-state difference-indifference estimates to...

Aus historischen, landesplanerischen und wirtschaftlichen Ursachen verfügt nur ein Teil der Gemeinden -zentrale Orte- eines Landes über öffentliche Einrichtungen, deren Wirkungsbereich über die jeweiligen Gebietsgrenzen hinausgeht. Durch den Bau und die Erhaltung dieser zentralörtlichen...

This paper examines the system of fiscal equalisation among local jurisdictionsin the state of Lower Saxony. The incentives emanating from this system for the choices of the local business tax rates are quantified. For this purpose, we compute for all municipalities the rate by which grants are...

The paper empirically analyzes the incentive effects of equalizing transfers on business tax policy by exploiting a natural experiment in the state of Lower Saxony which changed its equalization formula as of 1999. We resort to within-state and across-state difference-in-difference estimates to...